On April 12, 2024, Quantum Industry Canada (QIC) filed a submission to Finance Canada for the consultations on the SR&ED review and creation of a patent box regime.
Canada’s quantum sector, while nascent, will have a high impact on our country’s national interest and is poised to deliver outsized benefits to the nation’s economy and security.
Strategic support through thoughtful revisions to programs like SR&ED — arguably the most significant innovation policy tool in Canada — and the potential adoption of a forward-thinking patent box regime are essential to fuel this burgeoning field and ensure the Canadian industry is globally competitive.
As a trailblazer in quantum innovation, Canada boasts a thriving ecosystem that is swiftly transitioning from research to commercialization, heralding a new era of economic growth and national security.
Currently positioned as a global quantum leader and projected to contribute up to 3% of Canada’s GDP by 2045, the Canadian quantum industry’s potential to create over 200,000 jobs (according to a 2020 National Research Council of Canada study) underscores the urgent need for innovation policy tools like SR&ED and a patent box regime that are are not merely modern policy instruments but essential catalysts for a sector that is inherently R&D intensive and driven by invaluable intangible assets.
We extend our gratitude to the Government of Canada for considering our recommendations. As committed partners in enhancing Canada’s quantum sector and overall economy, we look forward to working closely with the Government to strengthen our nation’s position as a leader in this transformative field.
We’re also thankful to the members of the dedicated Working Group who drafted QIC’s recommendations on behalf of our consortium: Kyung Soo Choi, Camille Georges, Gordon Harling, Lisa Lambert, Sam Mugel, Angela Olano, Jordan Smith, and Nick Werstiuk.
Summary of Recommendations
Recommendation 1: Prioritize Canadian SMEs in strategic sectors for expedited SR&ED processing and enhanced payout rates
Recommendation 2: Streamline SR&ED approvals and enhance cash flow for innovators
Recommendation 3: Broaden SR&ED eligible expenditures
Recommendation 4: Adopt a nuanced revision to CCPC requirements to fuel growth and global competitiveness
Recommendation 5: Strengthen IP retention and R&D in Canada with a repayment mechanism
Recommendation 6: Implement a patent box regime as part of holistic innovation policy
